Following the recent positive developments from Saudi Arabia, market sentiment has begun to shift, and optimism is spreading. In the interbank market, some treasury heads now expect the rupee’s appreciation to continue.
An experienced treasury officer noted that while fundamentals remain unchanged, sentiment is improving, which could temporarily ease pressure on the interbank market. In his view, markets often swing with changing emotions, which eventually translate into concrete actions.
He further added that a few weeks ago, exporters were avoiding sales, anticipating rupee depreciation. However, after a meeting with the Field Marshal, some exporters stepped in and sold dollars. Following the Saudi news, the environment has changed significantly, and more exporters are now swiftly booking forward positions in anticipation of greater stability. Even rice exporters are entering the market, as the perception grows that flood-related damages are far less than initially estimated.
At the same time, importers—who were previously rushing to buy—have slowed down, improving market liquidity. Initially, many participants believed this stability was largely due to strict measures and would soon reverse. However, they are now beginning to view it as a genuine trend.
